PPL has filed for a $104.6 million rate increase which would increase residential fixed charges for electricity distribution – the fee for carrying electricity from wires to buildings – from $8.75 to $16.

The hike would boost the average total residential bill by about 6.3 percent and the distribution portion, distinct from charges for generating power and transmitting it across high-voltage lines, by about 16.5 percent.

PPL says that $10 million of the new revenue would recover losses due to severe storms of 2011 and finance consumer education, while the rest would pay for infrastructure upgrades. The Pennsylvania Public Utility Commission holds the last of five public hearings for comment on the proposal tonight in Harrisburg.

District 3 of the International Brotherhood of Electrical Workers sees jobs ahead from infrastructure upgrades. But another intervener in the case, the Sustainable Energy Fund, is concerned that an omission in the rate filing could discourage residential renewable energy investments.

IBEW District 3, covering Pennsylvania, New York, New Jersey, and Delaware, is “basically for this particular rate increase,” said district Vice President Don Siegel.

“Not just PPL but the entire electric transmission system has been kind of ignored over the last decade,” said Siegel. “There is certainly need for improvement. We think it offers job security, and over the long run, I think it offers security to the ratepayers as well.”

The amount of any increase, whether PPL gets all of its $104.6 million requested or settles with the PUC for less, determines how many contractors PPL can hire for infrastructure jobs, said PPL spokesperson Kurt Blumenau.

Less money could mean less hiring for contracted capital projects that can include “engineering and environmental consulting, as well as construction of new electric utility facilities, such as replacing equipment at substations or building new ones, and completing transmission and distribution improvements,” he said.

At the moment, PPL expects its contract worker pool to expand from 410 people in 2010 to 690 in 2013, he said. Blumenau said he didn’t have compensation information on the contracted jobs, “but clearly, these are skilled jobs requiring training,” he said.

Any construction site, whether it’s for an electric company substation or an office building, demands the same workers, such as truck drivers and carpenters, said Siegel of the IBEW, which represents about 4,000 people employed or contracted with PPL in technical and administrative jobs.

But upgrades create or sustain jobs in the highly skilled categories such as linemen, he said. Midstate salaries for linemen range from about $35,000 at entry to $62,000 and more with experience, according to the Pennsylvania Department of Labor and Industry.

PPL has been “more aggressive” than other utilities in updating infrastructure, which attracts businesses and sustains a skilled workforce, said Siegel.

“Obviously, none of this can be done without money,” he said. “We can argue about whether PPL’s making more profit than it should be, but at the end of day, you cannot build an electric utility infrastructure without funding, and of course, what do they sell? They sell electricity.”

The Sustainable Energy Fund is also intervening in PPL’S rate case. The SEF claims, in part, that PPL is misconstruing a PUC ruling from earlier this year involving power purchase agreements, also known as third-party arrangements, when a developer builds a solar system and sells the energy back to the property owner.

In those cases, the PUC capped net metering – when renewable energy systems send any excess energy created back to the grid and generate credits for the owner – at 110 percent of the previous year’s usage.

The ruling was meant to expand third-party arrangements but prevent developers from intentionally building overlarge systems and becoming, in essence, private power companies, said John Costlow, SEF director of technical services. But PPL’s rate case appears to apply the 110 percent cap to all residential systems, he said. The utility “ignored the expansion but kept the limit,” he said.

“They were adding a restriction that wasn’t there before,” Costlow said.

IF YOU GO:

The Pennsylvania Public Utility Commission’s last public hearing on the PPL rate case will be held 6 p.m. tonight in the Keystone Building, Hearing Room 1, 400 North Street, Harrisburg.

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